Rather than drop a neutron bomb into the heart of the U.S. patent system, the U.S. Supreme Court issued an anticlimactic decision that resolved little in a closely watched patent case that had Silicon Valley sweating for months.

The decision answered few questions. It satisfied almost no one. And it punted the most important issues back to the lower courts, the nation’s patent agency and lawmakers. The chances that these groups will suddenly work in harmony to fix our rickety patent system are about as likely as me sprouting wings and learning to fly.

The case in question, known by the shorthand of “Bilski,” turned on the issue of “business method patents.” Rather than covering the invention of a thing, these patents covered a process in areas such as e-commerce, software and finance. Silicon Valley companies have been awarded more than their share of business method patents, which critics argue have been spreading like kudzu threatening to choke innovation.

The best-known such patent is probably the one awarded to Amazon for its “one-click” process of ordering from its website. Priceline got one for its reverse auction process. DoubleClick snagged another for the way it delivered and measured online advertising.

In Silicon Valley, it’s often hard to know on which side of the fence a company might sit in this debate. Some large companies hold business method patents but would like to see them greatly restricted to reduce the chances they might get sued. Some small companies depend on them as their lifeblood, while other small companies simply exist to hold such patents and sue others.

How crazy is this? Consider that last month, Amazon was awarded a patent for something called a “social networking system.” To wit, the patent covers: “A networked computer system (that) provides various services for assisting users in locating, and establishing contact relationships with, other users.”

That would seem to be bad news for Facebook, no? But wait, Facebook was awarded a patent back in February for a “method for displaying a news feed in a social network environment.”

Someone also might want to tell LinkedIn founder Reid Hoffman and Zynga founder Mark Pincus. Back in 2003, they heard about a social networking patent being auctioned off by a defunct business called SixDegrees. Fearing that the patent would be used by some unscrupulous party to squash the emerging social networking industry, the two spent $700,000 to buy it. The episode is recounted in the recently published “The Facebook Effect,” by David Kirkpatrick.

Folks such as the Electronic Frontier Foundation have been railing against the evils of such patents for years. “The patents can be so broad that they cover a lot of activity that people have been doing for a long time,” said Michael Barclay, an attorney and EFF Fellow. “The result is a lot of patents that get allowed that shouldn’t get allowed.”

The counterargument is made by the American Intellectual Property Law Association and the Biotechnology Industry Organization. The latter is still giddy from a Supreme Court decision 30 years ago that allowed patents for genetically modified material, over the objections of those who felt patents of living things were an abomination. Their point is that it’s hard to predict where innovation will take us, but the patent system should remain flexible and open to adapt. Business method patents are simply a natural evolution of innovation.

“We have never in U.S. history ruled out a category of patentable ideas,” said AIPLA Executive Director Todd Dickinson.

With these two sides at loggerheads, enter Bernard Bilski, who applied in 1997 for a patent on a system he created to hedge risk in commodity training. It was rejected by the U.S. Patent and Trademark Office, setting off a long legal battle that led to a U.S. appeals court ruling in 2008 that seemed to all but kill business method patents. That decision had Silicon Valley brows sweating and the patent office facing the possibility of having to trash thousands of patents.

The Supreme Court heard the appeal last fall and issued a decision on its final day of the session. The enormously complex ruling, which involved multiple dissenting and concurring opinions, boils downs to this: Some business method patents are OK. Unless they are too abstract. Bilski’s is too abstract, so it goes in the dustbin. How do you figure out where to draw the line? The court didn’t say.

At least four of the justices thought business method patents should be prohibited, including retiring Justice John Paul Stevens, who said they could cause “mischief” and wrote: “A process for training a dog, a series of dance steps, a method of shooting a basketball … all would be patent-eligible.” But lacking a fifth vote to kill them, business method patents are here to stay.

The AIPLA was generally pleased, but would have liked to see the justices create a “bright line” around which patents were OK and which weren’t, Dickinson said. The EFF was deflated. “It’s disappointing that the Supreme Court didn’t take the opportunity to issue a broad and clear opinion on the patentability of these things,” Barclay said.

On the other hand, the folks at the patent office were feeling the relief of someone who had just avoided a neutron bomb going off in their house. Rather than descending into chaos that would have come with reviewing thousands of patents, patent officials were thinking about issuing follow-up guidelines at some point.

“I expect that standards will evolve over time,” said Bob Stoll, commissioner for patents. “The Supreme Court will not impose standards, but left it open to the patent and trademark office.”

So where does this leave Silicon Valley? Still grappling with the fundamental issue of how to make the patent system coherent. It is the goal that everyone agrees on but can never figure out how to get there. Which means in terms of the broader issue of patent reform, we’re back to square one having to figure out how to move forward since the Supreme Court decided not to do it for us.

A transit village with apartments, retailers, restaurants and a hotel is rising in Milpitas next to The Great Mall, close to light rail and the under-construction BART station. It’s one of several Silicon Valley projects sprouting up near transit.